The was some interest at KR in the possiblity of knitting using recycled shopping bags cut into strips. I crocheted this bag, but the same principles could be used for knittng.
I used my rotary cutter and quilter's ruler and the method presented here to cut my bags in preparation for crocheting. The actual design of the bag is totally free-form. I first crocheted an oval the size I wanted the bottom of the bag to be, then I continued straight up the sides without further increases. The handles were made during a regular round by simply crocheting a chain, skipping an appropriate # of stitches and then continuing on in rounds again. It made a nice, comfortable and strong handle.